The notion of cooperative networking often becomes more palatable once it's understood that cooperating is not about giving away trade secrets or merging with another business. Rather, it's about working with others in a complimentary fashion. The idea is to enhance the competitiveness of members, reduce costs, create new capital bases, increase advantages of scale, scope and speed, and open up new markets. For example, the Recycled ProductsPurchasing Cooperative operating out of Encinitas, California, works to promote the use of recycled paper in both the public and private sectors by running a purchasing cooperative that offers members information on services, prices, shipping, and the cost benefits of reusing paper waste.
Of course, as with most ‘new' business practices, joining a cooperative network requires a different way of thinking – one that debunks the traditional go-it-alone business mindset, which dictates that every company must supply its own research, product design, marketing, office support, supply routes, financial functions, production processes, and management. For example, a sizeable number of agricultural producers have discovered that by working together they can purchase and share expensive planting and harvesting equipment, decide which crops should be farmed, work to reduce water usage, and even set a fixed price for wholesalers. This prevents having to needlessly compete against other growers. It also lowers costs, decreases risk in the marketplace, and ensures a fair outcome for each participant. The reported success and stability of cooperative networks, however, is perhaps the most enticing factor to those that join. Although cooperative networks are not infallible, businesses that cooperate are more apt to satisfy social and entrepreneurial objectives, avoid ethical and legal lapses, and, in general, be more economically vigorous and competitive, especially against larger rivals. (Lotti, Ricardo, Mensing, Peter, and Valenti, David, ‘A Cooperative Solution', strategy +business)